The Restrictions That State and Federal Laws Place on Business

question 12

Multiple Choice

The restrictions that state and federal laws place on business with regard to the conduct of its activities are referred to as

• A) jurisprudence.
• B) competitive constraints.
• C) barriers to entry.
• D) restraints of trade.
• E) regulation.

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Definitions:

Straight-Line Depreciation

An approach to distribute the cost of a tangible asset evenly over each year of its expected life.

Fixed Asset

Long-term tangible property or equipment that a firm owns and uses in its operations to generate income, not expected to be consumed or converted into cash within a year.

Cash Payback Method

A capital budgeting technique that estimates the time required to recoup the initial investment in a project, using cash inflows.

Average Rate of Return

A financial metric used to estimate the profitability of an investment, calculated by dividing the average annual profit by the initial investment cost.